Melting flash-mem giant Spansion files for Chapter 11
Ex-CEO vows return of golden handshake
Melting flash-mem giant Spansion has filed for Chapter 11 bankruptcy, less than a week after suddenly axing 35 per cent of its workforce.
Meanwhile, Spansion ex-CEO Bertrand Cambou has vowed to return the $403,000 in severance he received after leaving the company in early February, telling a local newspaper he's "literally in tears" over the 3,000 workers cut loose without pay.
On Sunday, the company said it had filed for bankruptcy protection in an effort to "restructure its burdensome debt obligations and intensify its focus on market segments with greater profit potential." Those debt obligations come to $625 million.
"Given our focus on Spansion's future," reads a canned statement from new president and CEO John Kispert, "management and the board have concluded that Chapter 11 provides the most effective means for Spansion to preserve its business, meet its post-petition obligations and maintain customer confidence and continuity while we complete this restructuring."
Kispert replaced Cambou in early February, and although Cambou received a $751,000 golden handshake (plus a consulting gig), he has now rethought his severance in light of the recent layoffs, saying he will return all the money (minus what was taken by Uncle Sam).
"I hope they [Spansion] are going to take some of that money and give it to [those who were laid off]," Cambou told the San Jose Mercury News on Friday.
According to the paper, the 53-year-old has already sent a letter to the company's board of directors offering to return the money. "My heart is broken to see that a large amount of great people have been laid off without any severance," the letter read.
A Spansion spokesman tossed us the following statement: "We appreciate Dr. Cambou's symbolic gesture and his concern for the welfare of Spansion and its employees." Then he said the company was discussing the matter with the former CEO and president.
A joint venture of AMD and Fujitsu, the Sunnyvale, California-based Spansion is the world's third-largest flash maker. But its so-called NOR flash chips - intended for manufactures of cell phones and cars - are significantly less popular than the NAND flash chips manufactured by Samsung and Toshiba.
In the fall, Spansion heavily slashed employee pay, and on January 15, the company announced it was working to restructure its balance sheet - and perhaps sell itself - against the backdrop of a sinking worldwide economy. Then its Japan unit filed for bankruptcy. And on February 23, the company suddenly laid off 3,000 workers in the US and abroad - 35 per cent of its staff.
According to former employees speaking with The Reg, no US-based staff received severance pay, and hundreds had been on furlough for several weeks before the layoffs without pay.